The Government is to enter detailed talks to sell British Nuclear Group, the main operating subsidiary of BNFL, as part of the first stage of a break-up of the troubled nuclear fuels group.
It is understood to have contacted two US companies, Bechtel and Lockheed Martin, which it thinks could take control of BNG, a move that has angered potential bidders such as the project management group Amec.
The sell-off process is being led by Richard Gillingwater, the former merchant banker who was appointed as head of the Government's Shareholder Executive 18 months ago. This body, based in the Cabinet Office, has been given the task of improving "the Government's performance as shareholder in businesses such as Royal Mail, BNFL and the Royal Mint".
The Government formally gave up trying to privatise BNFL in 2003, and later unveiled plans to hive off all the liabilities of the UK's nuclear legacy in a body called the Nuclear Decommissioning Authority. The NDA is due to assume control of BNFL's troubled Sellafield plant and its unsuccessful Thorpe and Mox spent-fuel reprocessing businesses from April, although the process is being investigated by the European Commission after allegations that it involves illegal state aid.
The new BNFL will be made up of four businesses - Westinghouse, which owns nuclear reactors in the US; Spent Fuel Services, which will operate the Thorpe and Mox plants for the NDA; Nuclear Sciences & Technological Services, a consultancy; and BNG.
This business, run by Lawrie Haynes, a former water and telecoms executive, will be bidding for clean-up contracts from the NDA. It also owns BNFL Inc, which has major contracts with US nuclear facilities, and is claiming around $500m (£270m) compensation from Washington over these deals.
Informal soundings about the sale are understood to have already been made with Bechtel and Lockheed Martin, and detailed talks could take place as early as this week. However, no deal is expected to be announced until after the general election expected in April or May.
If the Government sells the business to Bechtel, it will cause the most almighty row. Bechtel has been advising the NDA on its clean-up plans and is precluded from bidding for any clean-up contracts for at least two years after the NDA is created. However, buying BNG will mean it gets around this.
Bechtel, a private company based in San Francisco, is also known for its opposition to unions. BNG has strong union representation among the 3,000 staff at its operations.
Amec, which is also bidding for clean-up contracts, is understood to be unhappy about not being approached by the Government. "If they are serious about selling BNG, then we are seriously interested in talking to them about it," a spokesman said.
BNFL denied that it had been a party to any sell-off talks concerning BNG. "We are not involved or aware of any such discussions," it said.Reuse content